A captive is a closely held insurance company, which provides coverage for and is controlled by its owners or members.  Although this insurance company (the Captive) insures your organization in a similar manner to that of a traditional insurance company, there are differences that provide additional stability and financial benefits.

Similarities

The Captive is reinsured just as a standard insurance carrier, through A+ rated re-insurers such as Ace Tempest Re or Gen Re.

Deductibles or Self-Retained Limits are still in place, similar to policies with traditional insurance carriers

Differences

You keep unused premiums and earn return off the investment of those dollars

You have a say in what the organization (Captive) does; you control your insurance destiny

Premium is based on your individual loss history, not grouped together with your industry's worst, as the traditional markets do.

Stable and predictable costs from year to year as you are distancing yourself from the fluctuating market of traditional insurance companies.

 

Does a Captive Program work well for everyone?

NO.  A company must be:

1) very strong financially

2) a far better than average performer in their industry

3) a leading advocate of safety measures

 

McConkey's background:

We have been working with Captive Insurance Programs since 1996, and have been influential in starting the 6th largest Group Captive in the world, as well as other national captives you can see listed on our website.

We believe this long-term approach to risk management works very well for the best-managed, safety conscious businesses, regardless of the traditional insurance market's current cycle.